Sunday, July 20, 2008

I've had many different responses from folk about the InBev purchase of Anheuser-Busch. These from three industry members who might be directly and indirectly affected stand out:

from a brewer whose brewery is partly owned by A-B at present, and thus soon may be owned by Anheuser-Busch InBev: "I don't know. I'm concentrating on making and selling my beer."

from an observer of the beer scene: "InBev is not going to concern itself with its craft holdings, at least at first. The capital invested in them is so small compared to the $52 billion dollars of debt accrued by the purchase that a sell-off would do very little to help."

an importer rep: "The sale won't make any difference to me or my high-end imports."

I'm not so sanguine.

I think that the combined power of the behemoths could be stultifying to the business. Even (or especially) the large indepedent wholeasalers, such as Reyes (which in the D.C./Va./Md. area is known as Premium), may suffer consequences.

The consolidation inherent in an InBev takeover of Anheuser-Busch Cos., which the latter brewer's board agreed to yesterday, will affect wholesalers much more profoundly than retailers, Nick Lake, v.p., client service, Beverage Alcohol, the Nielsen Co., told Progressive Grocer.

"The merger is likely to be neutral for retailers, as Anheuser-Busch already markets Inbev's European brands, including Stella Artois and Becks in the U.S.," Lake told Progressive Grocer. "The biggest changes will be at the wholesaler level, as more and more consolidation will likely happen [since] the combination of MillerCoors and AB Inbev represents over 80 percent of the category volume," he explained. "It may become more difficult for some imports and independent craft brands to maintain shelf space, as both MillerCoors and AB Inbev bring cross-segment portfolios to the retailer."